Recent case: Judge upholds marriage contract

hands on a book

Toscano v Toscano 2015 ONSC 487

Ms Toscano entered into a marriage contract when she married Mr. Toscano in which the two of them agreed to be separate as to property: that neither would make a claim against the other for a share of the other’s property.

The Toscanos separated after a 17-year marriage, in which they had two children, and Ms Toscano sought to have the contract set aside.

She argued that she had not received full financial disclosure, that she did not understand the consequences of the contract, that the terms were unconscionable, that she had been under duress and undue influence and that she did not have adequate independent legal advice.

The value of Mr. Toscano’s property was considerable – in the many millions of dollars – so there was a great deal at stake for both of them.

She also sought an increase in spousal support from $10,000/month to $20,000/month.

Mr. Toscano, not surprisingly, argued that the marriage contract was valid and should not be set aside. He also sought an order that Ms Toscano pay child support to him for the two children who lived full-time with him.

Justice Blishen reviewed Mr. and Ms Toscano’s rather complicated financial situations and the terms of the marriage contract, then moved on to consider the credibility of both parties. It was her conclusion that Ms Toscano’s evidence lacked credibility.

She found a number of inconsistencies within her evidence as well as between her evidence and that provided by others. In particular, she found:

  • Ms Toscano had ample opportunity to review draft of the marriage contract and, in fact, the contract was redrafted to accommodate suggestions she made
  • The lawyer from whom she obtained independent legal advice was selected by her and not, as she testified, by her husband
  • She had a number of appointments with her lawyer, who reviewed the contract in detail with her
  • She had a 4-year Business Administration degree and had worked in banking and then in the Toscano family business for a number of years, so was familiar with and able to understand contracts, financial statements and business affairs
  • The marriage contract was a freely negotiated agreement between two “educated and knowledgeable adults”
  • There was “no concealment, material misrepresentation, duress, unconscionable circumstances or material lack of disclosure”

Justice Blishen also noted that Ms Toscano entered the marriage with $10,000 and, despite the terms of the marriage contract, left with assets totalling approximately $1.27 million.

In her ruling, Justice Blishen imputed income to Ms Toscano for the purposes of making a child support order:

Ms Toscano has presented no evidence that she has made any effort to obtain employment or upgrade her business administration skills in order to present a plan for her own support. Given that both children reside with Mr. Toscano, I find it reasonable that Ms Toscano make all reasonable attempts to obtain employment . . . I will impute income of $40,000 and order Ms Toscano to pay $579 per month in child support for the children.

Given Mr. Toscano’s wealth, she did not require Ms Toscano to contribute to the children’s extraordinary expenses.

Because during the marriage, Ms Toscano had been the primary parent, ran the household, supported Mr. Toscano’s ability to build his business and wealth and now required training to re-enter the workforce, there was a considerable disparity in the standard of living between the two of them and Mr. Toscano had a net worth approximately seven times that or Ms Toscano. As a result, Justice Blishen found that Mr. Toscano should pay significant spousal support for an indefinite duration. She increased the amount of support he was paying from $10,000/month to $11,300.

Ms Toscano may well have regretted that she attempted to have the marriage contract set aside. She got no more property than she had already received. While her spousal support was increased by a small amount per month, Justice Blishen’s order put an end to Mr. Toscano paying for the lease of Ms Toscano’s car and imposed child support payments (retroactive for 14 months) on Ms Toscano.